Town of Andover
Town Manager’s
Recommended Budget
Fiscal Year 2015
February 10, 2014
“Using Andover’s Strengths
to Ensure Fiscal Stability”
Andover’s “AAA” S&P Municipal Credit
Rating Reaffirmed on October 14, 2013
Very strong management with sustainable formalized policies and a consistent ability to maintain balanced budgets;
Very strong economy which benefits from participation in the broad and diverse economy of Greater Boston;
Strong budgetary flexibility with 2012 audited reserves at 9% of General Fund expenditures;
Strong budgetary performance with consistent results in the total governmental and General Fund;
Very strong liquidity providing more than sufficient cash levels to cover both debt service and expenditures; and
Very strong debt and contingent liabilities position driven by the Town’s low net direct debt, albeit growing pressure from other post-employment benefit costs.
OPEB Actuarial Valuation
as of June 30, 2013
Segal Consulting – Actuaries
Total Unfunded Liability reduced by $70M
(from $214.8M to $144.8M)
Reduction due to a number of factors:
– Town commitment towards prefunding liability
– Health insurance plan design cost savings
– Changes to Medicare
– Favorable claims experience
Additional $14M reduction when the Town
moves Retired Teachers from the GIC
back to the Town’s health plans
The Town Manager’s
Recommend ed Budget for
Fiscal Year 2015
$164,602,262
$7M / 4.5% increase over the
FY14 Budget of $157.6 Million
FY15 Revenue Sources
FY2014 FY2015
REVENUES Approved TM Rec. $ Change % Change
Property Taxes $114,227,849 $118,944,997 $4,717,148 4.1% Addtl. Taxes - Debt Exclusions $3,278,583 $4,466,451 $1,187,868 36.2% State Aid $11,977,454 $12,553,113 $575,659 4.8% General Local Revenues $9,793,675 $10,027,000 $233,325 2.4% Offset Local Revenues $2,008,755 $2,278,000 $269,245 13.4% Water & Sewer Enterprises $11,928,200 $12,309,444 $381,244 3.2% Other Avail. Funds - Budget $574,735 $561,638 ($13,097) -2.3% Other Avail. Funds - Articles $609,300 $961,619 $352,319 57.8% Free Cash $3,180,966 $2,500,000 ($680,966) -21.4%
$157,579,517 $164,602,262 $7,022,745 4.5%
FY15 Revenue Highlights
Property Taxes – $118.9M (Prop. 2.5 levy limit)
New Growth – Projected at $1.5M (3-year average)
State Aid – $577k increase Ch. 70; UGGA level funded $1.5M
Free Cash – Estimated at $4.1M; None for operating budgets
OPEB Trust Fund – $1.0M from Free Cash; $400k GF; $100k W&S
Stabilization Funds – $500k to General SF; $1.0M to Landfill SF
General Local Revenues – MV Excise, Lic./Permits, Hotel/Motel
Offset Local Revenues – Increased Ambulance offset receipts to reflect expansion to Advanced Life Support EMS
TM’s Recommended Budget
FY2015
FY2014 FY2015
EXPENSES Approved TM Rec. $ Change % Change Town Departments $35,310,339 $36,528,546 $1,218,207 3.5% School Department $68,927,593 $71,304,452 $2,376,859 3.4% Obligations/Fixed Costs $25,357,998 $26,453,202 $1,095,204 4.3% Water & Sewer $6,538,246 $7,081,090 $542,844 8.3% Debt Service $13,035,320 $14,915,972 $1,880,652 14.4% Capital Projects Fund $2,280,000 $2,370,000 $90,000 3.9% Offset Expenditures $2,233,755 $2,503,000 $269,245 12.1% Warrant Articles $3,896,266 $3,446,000 ($450,266) -11.6%
$157,579,517 $164,602,262 $7,022,745 4.5%
Town Department Budget Highlights
3.5% Increase; Level Services, with minor service expansions
356.55 total FTEs; increase of 5.35 FTEs
– Elder Services: Additional hours for Intake Assistant/Trans. Coordinator – Youth Services: New Program Assistant II position
– Information Technology: Two new P/T (19 hr/wk) positions
– Muni. Services (Plant & Facilities): New Custodian and Maint. Electrician – Muni. Services (Water): Additional hours for Office Assistant II position – Police: Additional hours for Office Asst. II (Records Clerk) position
$74k increase in Solid Waste & Recycling
$300k increase in Water for WTP maintenance
$146.5k increase in Ambulance Revenue for Advanced Life Support (ALS)
Funding in Police Expenses to replace Reverse911 system
Stable utility budgets due to energy efficiency measures
Fixed Costs/Obligations Highlights
Health Insurance – $14.6M; 4% increase; out to bid
Retired Teachers Health Insurance – In process of moving RMTs from GIC to Town’s plans; $300k-$500k year savings
OPEB Trust Fund – $1.5M total; $400k GF; $100k W&S; $1M Free Cash
Debt Service – $1.9M increase; Bancroft Elementary School
Free Cash – Estimated at $4.1M; $2.5M recommended for use; $1.0M OPEB; $1.0M Landfill SF; $500k General SF
Capital Projects Fund – $2,370,000 / 1.5% of GF Revenues
Capital Improvement Program
“Revised” (CIP) for FY2015
General Fund Revenue: $2,370,000
General Fund Borrowing
:$3,910,000
GF Exempt Borrowing $0
Special Dedicated Funds: $1,950,000
Water & Sewer Enterprise Funds: $815,000
Total Revised CIP for FY15: $9,045,000
The complete FY15 CIP document is available on the Town’s website at www.andoverma.gov
Major Building Projects
Bancroft Elementary School
Andover Youth Center
Town Yard / Municipal Services Facility
High School Addition & Renovation
Ballardvale Fire Station
354.7 354.7 355.4 354.9 357.2 355.9 351.0 345.0 354.5 350.2 351.2 697.7
737.4 754.9 760.0
783.7 797.5 772.7 765.9 765.6
837.0 866.9
0 50 100 150 200 250 300 350 400 450 500 550 600 650 700 750 800 850 900 950
FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual Budget
Total FTEs
Town & School Employees (FTEs)
FY2004 - FY2014
Town FTEs School FTEs
10,216,624 9,692,632 7,798,859 7,626,719 7,813,475 8,515,323 8,982,692 9,225,806 8,046,255 7,444,297 7,839,065 8,918,106 9,168,103 9,965,455
- 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 7,000,000 8,000,000 9,000,000 10,000,000 11,000,000 12,000,000 13,000,000
FY2002 FY2003 FY2004 FY2005 FY2006 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 *
Net State Aid: FY02 – FY15 Gov.H2
(Revenue Minus Assessments)
Gov H2
FY15 Budget Review Sessions
February
Fri. 7th Town Manager’s Recommended FY15 Budget Released (on Town website)
Mon. 10th High Level Overview Presentation of Town Manager’s Recommended FY15 Budget Mon. 24th Shared Costs, Obligations and Debt
March
Sat. 1st Town Department Budgets (MHL – 9:00 am to 12:00 pm) (Muni Services; W&S; Library; ES/DCS/AYS – 30 min. each) Mon. 3rd CIP, Capital and Financial Articles
(Muni Services; Schools; Public Safety; IT, etc.)
Sat. 8th Town Department Budgets (Town Offices – 9:00 am to 12:00 pm) (CD&P; Police; Fire-Rescue; IT; and Gen. Govt. – 30 min. each)
Mon. 10th Review of Revenue Projections (State Aid, Local Receipts, Use of Free Cash, etc.) Wed. 12th Tri-Board Meeting – School Budget Request (Sch. Com. Mtg. Rm. – 7:00 pm)
Mon. 17th Warrant Articles Mon. 24th Warrant Articles
Wed. 26th Operating Budget, Capital and Warrant Article Votes (if needed) Mon. 31st Operating Budget, Capital and Warrant Article Votes
2014 Annual Town Meeting
7:00 PM, Mon., May 5
th, Tues., May 6
thand Mon., May 12th, Tues., May 13th (if needed).
J. Everett Collins Center,
Andover High School
The Town Manager’s
Recommended FY15 Budget
is available on-line in its entirety at
